Democrats officially disclosed the details on their proposed tax increases. Despite Republicans’ anticipated unanimous opposition to the proposal, here are some key tax deets:
Taxes on corporations, investors, and high-income business owners will see boosts — the corporate tax rate will increase 5.5% to 26.5% (up from the the Trump-era 21%). A ‘three percentage point surtax’ will be enforced on any American with income over $5 million. Capital gains taxes will also increase.
Individuals will see tax hikes as income exceeds $400,000. The proposal aims to collect more than $1 trillion in order to expand Medicare, increase renewable-energy tax breaks, and create a national paid-leave program.
The tax-shakeup will help fund a $3.5 trillion antipoverty, healthcare, and climate plan. According to Duke law professor Lawrence Zelenak, tax changes will make the income-tax system redistributive. Zelenak claims “It’s using the income tax to take money from only half the population and using it to distribute money to half the population.”
Sans Republican support, Democrats intend to use tax boosts to fund family and medical leave, subsidized child care, a further-expanded child tax credit, universal prekindergarten, and two years of free community college.
Now, we just have to wait and see if the proposal actually gets passed… Senator Ron Wyden of Oregon reminded legislators “It’s important to address the fact that billionaire heirs may never pay tax on billions in stock gains.”